#9 - Wells Fargo (NYSE:WFC)
Wells Fargo (WFC) has been in the news for all the wrong reasons. Fake accounts, inflated sales numbers, coercing employees to engage in fraudulent activity are typically issues that would cause investors to flee. However, Wells Fargo remains the second most profitable bank in the United States and Buffett and Berkshire-Hathaway seem to be willing to reward them for that. The firm has held their position on Wells Fargo at 452.8 million shares. While down from 464.2 million, the value of Berkshire's holdings is still at $27.8 billion, making it Berkshire's second-largest holding.
This is an example of where a little context can go a long way. To begin with the amount of stock that Berkshire sold represents only a small fraction of Berkshire’s stake, not exactly a huge sale. Second, in a recent interview, Buffet reaffirmed his belief in the bank’s long-term profitability stating that he believes it will “outperform the other big U.S. banks over the next 10 years”. And finally, Berkshire owns 9.3% of Wells Fargo. Were that ownership stake to reach 10 percent it would put Berkshire under additional scrutiny by regulators. The bottom line with Wells Fargo is that Buffett likes bank stocks and seems to have faith in Wells Fargo. Look for that confidence to continue although Berkshire may not be increasing their position anytime soon.
About Wells Fargo & Company
Wells Fargo & Company, a financial services company, provides diversified banking, investment, mortgage, and consumer and commercial finance products and services in the United States and internationally. The company operates through four segments: Consumer Banking and Lending; Commercial Banking; Corporate and Investment Banking; and Wealth and Investment Management.
Read More - Current Price
- $75.96
- Consensus Rating
- Hold
- Ratings Breakdown
- 9 Buy Ratings, 12 Hold Ratings, 0 Sell Ratings.
- Consensus Price Target
- $63.07 (17.0% Downside)
